Lowering prices, raising climate ambition

Walmart built itself into the world’s largest retailer by zeroing in on product prices. The company knows that every penny counts to consumers. Now, while it continues to lower costs for customers, Walmart is working just as hard to find ways to lower the accompanying cost to society with meaningful climate change actions.

Its efforts run the gamut from eliminating greenhouse gas (GHG) emissions to introducing more sustainable products, and its climate strategy is aligned with Walmart’s comprehensive Sustainability 360 system, which ensures that goals and targets reach every corner of the business. [1]

Every action Walmart takes is magnified by its size and leadership position. When Walmart changes direction, every provider in its huge supply chain and every competitor in its industry have to react or risk getting left behind. So everything the company is doing now to prevent risks from global warming—and plans to do in the future—has an “echo effect” that makes it that much more impactful.

20 percent energy reduction by 2020

In 2015, Walmart joined 200+ other businesses across the globe in making a commitment with WE MEAN BUSINESS (WMB) to lead the low-carbon business revolution.  We live in a world with a limit to how much carbon we can emit. [2] Walmart, through WMB, reaffirms its commitment to ultimately being supplied by 100 percent renewable energy.

By 2020, Walmart aims to reduce the total kWh-per-square-foot energy intensity required to power its buildings around the world by 20 percent against a 2010 baseline. By the end of 2014, the company had already achieved a nine percent reduction. [3]

Going big on renewables

A big factor in this strong forward progress is Walmart’s increased focus on renewable energy.

A decade ago, the company set an aspirational goal to run its operations using 100 percent renewable energy. [4] Building on this, the company is now committed to sourcing seven billion kilowatt hours (kWh) of renewable energy globally by 2020—an increase of more than 600 percent compared on 2010. [5] Recently, it restated this ambition as part of the RE100 campaign. Today, 26 percent of Walmart’s electricity is supplied by renewable sources, and while there’s still a ways to go, there’s a lot of work being done to get there. [6]

In 2014, the company procured more than 3,000 gigawatt hours (gWh) of Walmart-driven renewable energy globally. Heading into 2015, Walmart had more than 380 renewable energy projects in operation or under development in five countries and 17 U.S. states. [7] The company is the number one commercial solar energy user in the U.S. [8] Walmart is planning to expand the development of on-site and off-site solar, wind, fuel cells and other technologies and complementary energy efficiency measures. [9]

Suppliers as part of the solution

Walmart’s supply chain footprint is many times larger than its own operations, so it works directly with suppliers, farmers and factories to drive their energy efficiency and reduce emissions. [10] The results so far are promising. Walmart, collaborating with the Environmental Defense Fund, reduced more than 17.4 million metric tons (MMT) of GHG emissions from the company’s supply chain through 2014 [11] and is on its way to eliminating 20 MMT by the end of 2015.[12]

New projects are underway to continue this upward trend line. For example, suppliers representing 70 percent of Walmart’s business sourced in China will be invited to participate in an energy efficiency program by the end of 2017.[13]

The company also worked in collaboration with NGOs, suppliers and scientists at The Sustainability Consortium to create a Sustainability Index for suppliers, which measures and analyzes energy data—among other sustainability data—to assess the environmental impact across a product’s life cycle. To date, nearly 1,300 Walmart suppliers are using the Sustainability Index to drive more sustainable production, and the products evaluated represent 65 percent of the goods that were sold in Walmart’s U.S. stores in 2014. [14]

Putting all these efforts together, the company has reduced its Scope 1 and Scope 2 carbon intensity for eight straight years and is on track to hold absolute emissions flat over the decade, despite continued growth. [15]

With more customers on the lookout for sustainable products—and sustainable companies—Walmart believes that climate leadership makes long-term business sense. In fact, Walmart expects to generate more than $1 billion in energy savings annually once its 2020 energy goals to increase renewable energy use and energy efficiency in its facilities are fully implemented. [16]

With bold, long-term targets and impactful projects, Walmart is striving to move the needle on climate change as it moves products off its shelves.  In this way, the world’s largest retailer is showing that leadership on climate change goes hand-in-hand with delivering the best value and quality to consumers.

[1] CDP climate change response 2014
[16] Walmart RE100 case study notes

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